The requirements to obtain a mortgage for a second home are stricter than to obtain one destined to finance the first residence.
The mortgage for second home usually finances between 60 and 70% of its value.
The bank assumes greater risk by granting mortgages intended for the purchase of an unusual home.
However, having a second home in property is not cheap, but rather a high expense. In fact, according to a recent analysis by the Organization of Consumers and Users (OCU), maintaining a second home on the Spanish coast costs on average 1,791 dollars per year.
In addition to the maintenance costs, a second residence means, in the vast majority of cases, ask the bank for a second mortgage to finance its purchase. These mortgages usually have fairly strict requirements and conditions, something is due in large part to be a property not intended for the habitual residence.
Increased risk, tighter requirements
It is not new that for an entity to grant a mortgage is necessary to meet a number of requirements and meet conditions that, in many cases, are not available to everyone. These requirements are much more stringent if the home to be acquired is not intended to be the primary home of the mortgaged or his family, but their purposes are vacation or second home. This is due in the first place to the fact that the client is at greater risk of not paying because it is not a necessity for him because it is not his main home. Therefore, if necessary, you will not pay the mortgage on your house on the beach before your usual home, for example. On the other hand.
Less funded amount
The first thing to consider before buying a second home is that the financing provided by the bank will be lower than the one you would give in the case of a main house. At present, the financing that most entities provide in the case of the first dwelling corresponds to 80% of the appraisal value of the dwelling. In the case of the second, the most common is that financing is between 60 and 70% of the value of housing.
That the bank lends less money to the client means that the client must have more money saved to be able to contract the mortgage. In the case of the second home, it is imperative that the prospective buyer has sufficient savings to assume between 30 and 40% of the value of the home, which will be the amount that will have to be paid to the bank as an “entrance”.
High and stable income
Just as institutions often require greater savings to acquire a second home, the client must also have stable and high income so that the bank can agree to lend the money. If in the case of the first dwelling, the monthly income is around 2,000 dollars, for the second this amount will have to be around 500 or 1,000 dollars higher. On the other hand, the borrowing entity will also require the client to provide guarantees such as having an indefinite job in which it can demonstrate some stability and seniority. In addition, other essential requirements are to keep abreast of payments and invoices, not having a very high level of indebtedness or not appear in any file of defaulters, as happens when any mortgage is requested.
Finding the best mortgage
In addition to imposing high requirements, banks often guard their backs against a major risk with high interest rates on their mortgages, whether at fixed, variable, or mixed rates. That is why to find the most suitable for each person is necessary to compare different products and entities.